When considering your consituents, surely High Net Worth donors, those with $1 million in investable assets or annual income of $200,000+, are always high on your target list.
A new report from Bank of America provides some great insight on the charitable habits of High Net Worth (HNW) donors, as well as a few trends, which are very encouraging for the nonprofit community.
“This year’s study, more than ever, tells us that when wealthy donors are intentional about and engaged in their giving—when they find that meaningful intersection between their ideas and ideals—they give more, are more impactful and more personally fulfilled,” said Claire Costello, who led Bank of America’s 2014 U.S.Trust Study of High Net Worth Philanthropy.
Three-quarters of those surveyed volunteered for at least one organization last year and gave 73 percent more on average than those who did not volunteer ($76,572 compared to $44,137). Additionally, 34 percent volunteered more than 200 hours. These are people who give both their time and money, as also referenced in my Third Sector Today article Transforming Volunteers into Donors.
When asked why they give, HNW individuals cited several motivating factors. At the top of the list were personal satisfaction and believing that their gift could make a difference. Tax advantages? Deductions on tax returns was actually the very least of their concerns.
And why do the wealthy stop giving? The two main reasons were because they receive too frequent solicitation and nonprofits asking for inappropriate amounts. Also, nearly 80 percent expect their privacy/anonymity to be respected and prefer that an “appropriate” amount of their donation be spent on fundraising and general administration.
Some other highlights from report:
- In 2013, the average dollar amount given to charity by wealthy donors increased 28 percent.
- Nearly all (98.4 percent) of wealthy households donated to charity in 2013.
- In the next three to five years, 85 percent of wealthy donors plan to give as much or more, citing “increased financial capacity” and “perceived need of the nonprofits or causes.”
- The majority of wealthy donors are strategic in their giving (only 7% give without any particular focus).
- Online giving is becoming more popular amongst the group (up for 15 percent to 50 percent over the last decade).
While everyone may not be planning to give away their entire fortune, as Warren Buffet has pledged to do, this report provides evidence that the wealthy are certainly generous and have great faith in nonprofits. Perhaps the most interesting finding was that while only 18% of HNW individuals approached nonprofits to volunteer, nearly half of them gladly accepted when an invitation was extended from a nonprofit.
So, now may be the perfect time to expand your volunteer AND donor roster!
For more information on this topic:
How Much Do the Ultra Rich Give to Charity
How the Other Half Gives: Philanthropy from High Net Worth Individuals
25 Super Rich People Who Use Their Money To Help The World
5 Ways Charities Can Attract Rich Donors